Oculus Rift and others are coming out with products that offer truly immersive experiences

Project Morpheus will work with the PS4, PlayStation Camera, and the DualShock 4 and PS Move controllers. It will feature a 1080p display and accelerometer and gyroscope sensors built-in. Sony also announced that the headset will include new 3D audio technology that can change the direction of sounds, based on the position of your head.

While Oculus Rift has been generating a lot of buzz with its prototypes, Sony has the clout to make a more immediate impact on the gaming industry. Sony already has a relationship with many top game developers, and the PlayStation 4 had a successful launch last holiday season.

Recent rumors suggest that Microsoft is also be working on some form of virtual-reality technology for the Xbox One. This seems likely, as Microsoft won't want to be left out of the trend—and a VR headset coupled with the Kinect motion sensor has huge potential.

Imagine being able to immerse yourself in another world, without the limitations of a TV or movie screen. Virtual reality has been a dream for years, but judging by current trends, it may not be just a dream for much longer.

Here's the concept, at least as it exists today: You put on a headset that allows you to move your head and freely look around—not at the actual world but inside a virtual space. For example, you could be sitting on your couch with a headset on that takes you on a helicopter tour of Hawaii. You’d be able to hear all of the sounds, swivel your head around to inspect the helicopter, and peer down to see inside the volcano, as if you were really on the chopper.

So what is the current state of virtual reality? One product, the Oculus Rift VR headset, really turned some heads at CES this year. The company's newest prototype, called Crystal Cove, features a 1080p OLED display and features positional tracking, which lets you move your head while wearing the headset and having the movement translate in the application, like in our Hawaii example above. For example, if you’re playing a game, you could lean forward to see farther or peek around corners.

There was also a motion-tracking exoskeleton suit at CES designed by PrioVR that could be used for in-game control. When coupled with a headset such as the Oculus Rift, this could be a truly immersive experience.

The Oculus Rift has no scheduled release date yet, but Sony is doing something similar right now. The company offers personal-viewing head-mounted displays that let you watch a virtual screen. Its newest offering is the HMZ-T3W Head Mounted 3D Viewer. These displays don’t offer head tracking. But rumors have it that Sony will announce its own VR headset, as an accessory for the PlayStation 4, at the Game Developers Conference in March.

The advantage of VR for gaming applications is obvious, but what if you’re not into video games? Some companies are exploring other ways to use this brave new technology.

Ford, for example, uses the Oculus Rift’s technology for vehicle demonstrations, allowing a person to view a car from all angles. The person can even sit in the driver's seat and look around the interior of the car.

The technology could be used for virtual vacations, like the Hawaii helicopter ride. Imagine going on a tour of Paris without ever leaving your home. Classroom-type experiences are also in the works: A team from Harvard is working on software called The Giza Project, which allows a person to see the pyramids in Ancient Egypt.

NASA has also taken advantage of the VR technology along with a Kinect motion-sensing camera (more video-game stuff!) to control a pair of robotic arms. Those would be a huge help on an unmanned space mission, for example.

And training applications for the military and medical community are being developed by companies such as Arch Virtual.

On the more practical side, the headsets could be used to kindle interest in 3D movies—or even just as a personal display. I would love to be able to binge-watch a season of "The Walking Dead" while my wife sleeps next to me, blissfully unaware of the huge nerd she married. Although having a VR headset strapped on my face might be something of a giveaway.